While more businesses are experimenting with using NFTs, the majority of the use cases remain centered on the digital collectibles/art angle. As brands begin to gain a better understanding of the underlying functionality made possible with NFTs, we will see more robust and dare I say relevant business examples.
Case in point: NFTs can be used by brands as digital membership cards. Not just digital membership cards, but dynamic ones at that, membership cards that evolve and change based on the member’s participation and activity within the program.
Why Use NFTs as Digital Membership Cards?
It’s a valid question, I mean whether you are using membership cards for your organization or as part of a brand ambassador or loyalty program, these members already have a card they carry in their wallet, right? Or maybe they even have a digital membership card on an app. Why is it better to use an NFT as a digital membership card?
There’s a few reasons:
1 – Eliminates the need to mail out physical membership cards. They are easy to lose, hard to track who has one and who doesn’t. Plus the associated printing and mailing costs.
2 – Physical cards are more likely to be stolen or used fraudulently. A digital membership card helps alleviate this concern.
3 – Digital membership cards are more dynamic, and can more easily foster a connection with the brand. With a physical card, the connection is more to the card itself, and any discounts or features it entails. A digital membership card makes it easier to facilitate real-time communication with the brand and receive relevant updates.
But why use an NFT as a digital membership card instead of an existing one?
Many of us already have our membership tied to a digital membership card on our phone in a wallet or maybe in an app. For instance, I have the Chick-fil-a app on my phone. It has all my rewards program integrated into it. I can see how many rewards points I have, what those points can be spent on, etc. This is a natural evolution of the membership card as associated digital technologies have matured. If this program was around 30 years ago, there would be no app, any tracking done would have to be on the physical card itself. This is why punch cards were so popular for so many years, and are still used to this day.
But as digital technologies evolved, then we could track activity associated with a membership card digitally via an app, for instance. This makes it easier for the brand and customer to see and track activity, and make adjustments on the fly. For instance, the local Chick-fil-a store manager can send me a reward at any time, straight to my app. In a pre-internet world this could be done, but via mail or an in-person visit.
With NFTs, we have the next evolution of memberships. NFTs take many of the conveniences we have with existing digital membership cards (portability in an app, ease of use and ability to add points and offers) and expands on it.
Your NFT is Your Identity
One of the key aspects of a successful brand ambassador or loyalty program is to make the members feel special. Because they are. I wrote about this recently, but one of the key drivers of customer loyalty is if the brand treats the customer like a VIP. The NFT can store not only your membership level and privileges, but also your identity and standing within the program. If you were one of the first 10 members to an ambassador program that now has 100,000 members, that’s part of the digital DNA of your NFT. That’s recorded, along with the benefits that you have as a result. If you attend brand events, the NFT can not only act as your ticket, but it can also verify your attendance and involvement.
Additionally, the NFT can be a collectible. Unlike a digital membership card that’s incorporated into your photo app, an NFT serving as your membership card can be collected and traded.
Let’s go back to the previous example of being one of the first 10 members of an ambassador program that now has over 100,000 members. That not only entitles you (if the brand is smart) to much better perks and utility than newer members, but it gives you a lot of clout within the community itself. You are an OG, and that’s recorded in your NFT. So it means that within that 100,000 member community, your NFT has value. Maybe you want to sell that NFT to another member of the community. You could do that, and pass along the benefits (and clout) that comes with the NFT.
The value that the NFT has amassed reflects the work that the member has put into helping grow the community and program. So it’s a way for the member to monetize the time and effort they have put into the program. Or if the member wants to help onto their NFT, they could receive tokens associated with their work and length of time in the program. This is another form of compensation which is easier to facilitate via an NFT vs existing digital technologies.
Is your business ready to create its first NFT? This article tells you how to get started.